Fortuna soars on fast repay plan for Senegal gold project

Fortuna Mining (TSX: FVI; NYSE: FSM) says a preliminary economic assessment (PEA) for the Diamba Sud gold project in Senegal shows the Canadian miner could recoup its investment in less than a year. The stock hit an all-time high.

Using a gold price of US$2,750 per oz. and a discount rate of 5%, the study shows an after‑tax net present value of $563 million (C$788 million), an internal rate of return of 72% and a payback of about 0.8 years, Fortuna said Wednesday in a statement. Initial capital costs to develop Diamba Sud are pegged at $283.2 million.

The PEA represents “a positive rerating catalyst that unlocks the viability over Fortuna’s organic growth opportunities and target to reach about 500,000” gold-equivalent ounces, National Bank Financial mining analyst Mohamed Sidibé said Wednesday in a note. “The improved production profile from 2028 and beyond should be well received by the market.”

Fortuna is counting on Diamba Sud to help it reverse an output drop triggered by the recent sale of operations in Mexico and Burkina Faso. Fortuna expects to produce up to 339,000 gold-equivalent oz. in 2025, down from a record 456,000 oz. last year.

Shares of Fortuna rose 4.2% to C$13.42 Wednesday afternoon in Toronto. Earlier they touched C$13.76, their highest intraday level since the stock began trading in 2010. They have more than doubled this year, boosting the company’s market value to about C$4.2 billion.

Construction decision

Vancouver-based Fortuna expects to make a construction decision for Diamba Sud right after publishing a feasibility study, which the company wants to complete by mid-2026.

Assuming a positive decision, full construction would start in next year’s fourth quarter, after the rainy season. First gold pour would be targeted for the second quarter of 2028.

With liquidity of $537.3 million and a net cash position of $214.8 million as of June 30, “Fortuna is in a strong position to fund construction,” BMO Capital Markets mining analyst Kevin O’Halloran said in a note.

Diamba Sud is expected to produce 840,000 oz. gold over the mine’s 8.1-year life, averaging 106,000 oz. a year at an all-in sustaining cost of US$1,238 per ounce. Future exploration success could extend the mine’s life beyond a decade, CEO Jorge Ganoza said in the statement.

The project holds 14.2 million indicated tonnes grading 1.59 grams gold per tonne for contained metal of 724,000 oz., according to a 2025 resource. Inferred resources are pegged at 6.2 million tonnes grading 1.44 grams gold for contained metal of 285,000 ounces.

Open pit

Fortuna plans to build an open-pit mining operation that would feed a conventional carbon-in-leach processing plant. It would develop multiple deposits at Diamba Sud, including Area A, Area D, Karakara, Western Splay, Kassassoko, Moungoundi and Southern Arc, with no more than three pits mined at any one time.

Initial throughput is projected to hit 2.5 million tonnes a year during the first three years of operation, supported by the high oxide content at Area D. Annual throughput would then slow to 2 million tonnes from year 4 onward as the feed becomes predominantly fresh material.

The initial capital cost projection includes $4 million in capitalized closure costs to be deposited into escrow and a $46.4 million contingency, Fortuna also said. Sustaining capital is estimated at $40 million, while closure costs are estimated at $8 million.

Diamba Sud sits in the Kenieba-Koudougou inlier, an area straddling eastern Senegal and western Mali that hosts several large gold deposits. Fortuna inherited the project in 2023 when it acquired Africa-focused explorer Chesser Resources.